Suppose your marketing department does a survey of potential users and finds that these users place the following values on the two versions of your software:
Software version: Home Users: Commercial Users:
Full-featured version $175 $225
Disable version $150 $200
If the numbers of home and commercial users are equal, and you cannot distinguish between commercial and home users, what is the most profitable pricing strategy? Assume the MC of production is zero. Explain your answer.
a. Sell to only commercial users.
b. Sell to only home users.
c. Sell to both groups using a single price.
d. Sell to both groups at two different prices.